The following article originally appeared in Hedgeweek and was written by Angele Paris.
Cyber security is a relatively new compliance requirement in the investment management space. Align sees cyber security as a multi-factorial phenomenon and thus its team takes a multi-disciplinary approach to providing comprehensive solutions to the cyber security challenges investment managers face day-to-day, as well as within the context of their capital raising, ODD and compliance activities.
John Araneo (pictured), managing director and general counsel at Align, explains that in 2018, the firm bolstered its cyber security offering by making remarkable progress in building a mature outsourced IT offering that utilizes the public cloud and is specifically optimized for investment managers. As a sibling line of business to its cyber security advisory services, Align’s new public cloud offering provides the optimal construct from which our cyber security services can be realized. “Align designed its public cloud solution so that it achieves both an elegant and efficient integration with our cyber security team,” he says.
This integration allows Align to stand alone in providing a “potent one-two punch, which together creates inherent economies and efficiencies for those fund managers who are currently burdened with the duality of solving both their IT challenges and also meeting their cyber security objectives. Eliminating the need for multiple service providers to solve these two inextricably intertwined challenges, in favor of using one advisor, is a huge area of growth,” Araneo says.
Align is expecting increased adoption of the public cloud. The perception around the investment management world appears to have reached the tipping point, Araneo explains. “The public cloud has gone from being perceived as a very wild-west, anything goes, environment to now emerging as the most secure environment out there with Microsoft, AWS and Google investing billions of dollars into the security posture of their respective environments.
“We are witnessing headwinds that portend a mass exodus of fund managers going into the public cloud and reaping the benefits of all the baked-in security features, as well as its inherent scalability,” he says.
The public cloud provides a more predictable and efficient cost structure which allows its managers to demonstrate more operational efficiency, with Araneo adding: “The public cloud providers are constantly investing into their own environments themselves, so clients no longer have the burden of continually updating a server or technologies on their own and benefit from this trend of ‘passive innovation’.”
2018 saw Align establish itself as a premier cyber security advisory firm. “We’ve taken a lot of time to architect a corresponding IT solution on the public cloud which is specific for investment managers and which can be curated to the way they operate their data flows, while conforming to their regulatory needs. To promote the benefits of our new public cloud offering and explain how it integrates well into our cyber services – that’s our charge for 2019.” Araneo explains.
He believes the next three or four quarters will usher in a “changing of the guard” in terms of the firms providing outsourced IT services. Align believes there is a need to not only provide IT services but to also simultaneously and efficiently foster an environment in which providers and managers can build a robust cyber security program at their own pace.
Winning the Hedgeweek award is, “tremendous, wonderful exposure,” says Araneo, “hopefully it’s an affirmation that the way we’ve approached cyber security is unlike any other provider in the space. The multi-disciplinary approach we take with our team of experts makes us very different, and this award is just a wonderful affirmation of that.”